The Problem At Peninsula Hospital Center

For years, many Rockaway residents who had adequate health insurance coverage went off the peninsula for medical care if that was anything more than emergency care involved. The conventional wisdom was that you couldn’t really trust the local hospitals for anything more than a band aid. When Peninsula Hospital Center began the long road to bankruptcy early last summer, may people turned their heads and said, “We told you so.” Others, however, looked into the abyss and realized that the vital 110-year-old institution was sorely needed, that Rockaway needed two hospitals badly and that PHC and St. John’s Episcopal were the only games in town for emergency care and out-patient treatment. In September, a White Knight in the guise of Faye Zakheim rode into town and the community board of directors grabbed at the lifeline she threw them even though there were a lot of problems with a for-profit taking over a non-profit hospital. In fact, such a move is illegal without state permission, but the state winked its eye and employed the fiction that Zakheim and her Revival LLC were only lending money to the hospital, not taking it over. That fiction was harder to maintain when Todd Miller, a former Revival bigwig was made CEO of the hospital. Even more so when several other Revival officers moved into the Rockaway facility and the hospital started to drop its staff and suppliers for those associated with Revival. In fact, a bankruptcy court trustee said in a report that, at the very least, there was an appearance that Revival had taken over the administration of the hospital. We wonder how long the state will maintain the governance fiction under present circumstances. Miller has told us often that things were great, that more and more people were gaining confidence in the hospital and things were coming up roses. We didn’t believe it, but we hoped it were true. Then, late last month, the state’s Department of Health burst that bubble. They closed hospital’s lab for up to 30 days due to problems so gross that they threatened the health of the patients in the hospital. All of those who needed laboratory services were moved out to other facilities. All ambulances were diverted to other hospitals. There is a question of whether, under the circumstances, the hospital can meet its obligations even if the DOH lifts the ban in the next week or two. We are not even sure that Revival wants the hospital to succeed. Part of the financing deal between PHC and Revival was a mortgagee on the nursing home, PHC’s most valuable asset. Should the hospital be closed, insiders say, Revival gets the nursing home free and clear. “There is no downside to closing the hospital as far as Revival is concerned,” we were told by that insider. “In fact, Revival would be better off financially if the state closed the hospital for good.” There are those who believe that any hospital is better than none. We are not among that group. The state should move quickly to resolve the governance problem and then to closely monitor whoever is actually running the hospital. It is better to have no hospital at all than it is to have one that kills its patients through inattention and a desire to save money for its owners.